How do you make the change to paying quarterly taxes?

Question

I have a full time job, but will start doing some fill in work for other companies part time. Can I file quarterly if I have a full time job? How do I make the change?

I have a full time job, but would like to start doing fill in work for other companies part time. If I want to bill them as a contractor, I need to start filing quarterly taxes. Can I do this while still maintaining a full time job? How do I make the change?

Answer 1

It really depends on how much income you make from your contracting work, but you have several options. Yes, you can make quarterly estimated tax payments, but you may not have to.

You have the option of increasing your withholding from your full-time job to compensate for the extra income from consulting. Withholding from wage is considered distributed over the year, so you could avoid penalties by increasing your wage withholding at the end of the year.

If you would rather make quarterly payments, or the income from consulting is to much to make wage withholding feasible, then the important thing is to make sufficient payments. Just make sure to add your consulting income on top of your normal salary to make sure you are making the right payments. There is more information on the IRS webpage.

Answer 2

You just send in the 1040ES form, along with your payment, by the quarterly deadline.

You still file your regular tax return at the end of the year. Filing quarterly is just for payment deposits, you don't do a full tax return except at the end.

Anyone can file quarterly, full time job, side job, or any income - and should if they expect to owe over $1000 at tax time otherwise.

Answer 3

You can't file returns quarterly but you can make quarterly estimated tax payments if you think you're going to owe more than you have withheld.

Answer 4

Individuals only file one return per year. However, you may be required to make four payments per year. To determine if this is the case, and to calculate the amount of the payments, you use Form 1040-ES. You can download this form from http://www.irs.gov/pub/irs-pdf/f1040es.pdf (first time filers), http://www.irs.gov/pub/irs-pdf/f1040esn.pdf (non-resident aliens), or http://www.irs.gov/pub/irs-pdf/f1040ese.pdf (all others), if you do not have one.